Wednesday, May 12, 2021
Real EstateUK

Property market could stall next year as buyer queries wane

Property market

According to the latest survey from the RICS, Wales and the South West of England saw values rise last month, but sales levels in Scotland and the Midlands are starting to fall

Surveyors warn that the withdrawal of the stamp duty holiday and the end of the Government’s furlough scheme at the end of March next year look set to put the brakes on the ‘mini-boom’ the property market has enjoyed this year.

Average property prices continued to rise ‘sharply’ in most parts of the country last month, but buyer demand is showing some signs of losing steam as the year draws to a close.

Wales and the South West of England continued to see values rise strongly last month, but sales levels in Scotland and the Midlands are already starting to tail off, the latest survey from the Royal Institute of Chartered Surveyors (RICS) showed.

Simon Rubinsohn, chief economist at the RICS, said there was ‘considerable concern’ among surveyors about the prospect of a marked slowdown in sales levels in the housing market after the end of the first quarter of 2021.

He added: A scaling back in direct government support for the market is part of the reason for this but it is being compounded by expectations of material rise in unemployment as redundancy programmes begin to take effect. Meanwhile, there is little sense that the projected softer sales picture will feed through into pricing which is viewed as likely to prove rather stickier in the face of ongoing macro challenges.

A key issue as government looks to continue to build the delivery pipeline will be the response of developers to a tougher market without the incentive of the stamp duty break and the tapering of the Help to Buy scheme. Critically, it is not simply a numbers game with the latest price moves highlighting ever more acute affordability issues and the importance of ensuring adequate provision across tenures.

Summing up the state of flux the housing market is in at present, Allan Fuller, of Allan Fuller Estate Agents in London, said: Demand for houses has been strong, but fewer enquires as we get towards the end of 2020. Transactions slow and not all will make March stamp duty deadline.

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